How to Create a Culture of Candor

Adapted from “The Wall Street Journal Guide to Management” by Alan Murray, published by Harper Business.

There are no silver bullets in the field of management. But insisting on candor comes as close to being an all-purpose problem-solver as any idea yet encountered. There are many different terms for it – transparency, integrity, honesty, full-disclosure, facing reality – but whatever you call it, it appears to be at the core of all great organizations.

The reason is that organizations, like people, have an endless ability to weave self-serving stories about themselves. And while such myth-making may be critical to a person’s, or an organization’s, survival, motivation and self-esteem, it can often be destructive to results.

Business author Jim Collins calls this the “Stockdale paradox” after Admiral Jim Stockdale, who was tortured repeatedly as a prisoner of war in the “Hanoi Hilton” during the Vietnam war. When asked by Mr. Collins how he survived his long ordeal, Adm. Stockdale replied that it was by never losing faith he would eventually get out. When asked who didn’t survive, Stockdale replied that it was the “optimists” – the ones who thought, wrongly, they’d be out by, say, Christmas.

“This is a very important lesson,” Adm. Stockdale told Mr. Collins. “You must never confuse faith that you will prevail in the end – which you can never afford to lose – with the discipline to confront the most brutal facts of your current reality, whatever they might be.”

Great organizations exhibit a similar paradox. They are filled with people who are absolutely determined to see the organization succeed, whatever the odds against it. But they are also filled with people who are unstintingly honest in confronting the obstacles they face.

The first step toward creating a culture of candor is to ensure a free flow of information. That doesn’t mean everyone needs to know everything; but it does mean that critical information gets to the right people at the right time and for the right reason.

“For any institution, the flow of information is akin to a central nervous system,” write Warren Bennis, Daniel Goleman and Patricia Ward Biederman in their book “Transparency: How Leaders Create a Culture of Candor.” “The organization’s effectiveness depends on it. An organization’s ability to compete, solve problems, innovate, meet challenges and achieve goals – its intelligence, if you will – varies to the degree that information flow remains healthy.”

There are many reasons why the flow of information gets stunted in an organization. One widespread problem is the difficulty of “speaking truth to power.” When speaking to their bosses, most people inevitably color the message – softening bad news, or spinning it in a way more that’s more likely to please the person in power. That can cause problems to go unaddressed.

Another problem is the tendency of managers to hoard information as a source of power. If they have it, and others don’t, they can use that to justify their existence, or wield it selectively to achieve their own goals.

Sunk costs are yet another reason why people hinder the flow of information. If they’ve invested heavily in a project, they may be reluctant to pass on information showing that project has problems, or is failing.

To overcome these very natural human tendencies, managers must insist on candor at all times. They must reach out and solicit intelligence from as many people as possible. They must accept, and even welcome, troubling information when it’s delivered to them, and praise those with the courage to surface unpleasant news. They must create systems designed to ensure good information flows to those who need it. And they must make it clear they are not interested in incessant happy talk.

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